Thailand's baht was little changed after the central bank said it will take steps to avoid excessive gains in the currency. Government bonds advanced.

The baht onshore has risen 2 percent this year, the third-best performer among the currencies of the 17 largest economies in Asia, as exporters converted foreign-exchange proceeds. The central bank wants the baht to remain ``competitive'' and move in line with its regional peers, Governor Tarisa Watanagase said yesterday.

The baht held at 33.05 per dollar as of 4:15 p.m. in Bangkok, according to data compiled by Bloomberg. It reached 33.04, matching the strongest since August 1997. Only the yen and Malaysian ringgit have gained more in Asia this year. Offshore, the baht was at 31.42.

``As long as regional currencies strengthen, the Bank of Thailand will not be able to keep this level of 33,'' said Tetsuo Yoshikoshi, a market analyst in Singapore at Sumitomo Mitsui Banking Corp. ``Exporters continue to sell dollars against onshore baht because they fear further strength.''

The currency may trade as high as 32.90 by the end of March, Yoshikoshi said.

``We want the baht to remain competitive and not too strong compared with other currencies,'' Tarisa said in Bangkok yesterday. ``We will continue to curb any excessive moves, especially if such moves come from short-term speculation.''

Capital Outflows

The Bank of Thailand plans to ease rules on capital outflows to help stem baht gains, Tarisa said without elaborating.

Selling of dollars by exporters has helped strengthen the baht. Thailand's current account surplus was a record $2.65 billion in November, while exports reached an all-time high of $14.6 billion, according to a central bank report last month.

The nation's 10-year bonds advanced for a second day. The yield on the 5.125 percent year note maturing in March 2018 fell 13 basis points to 4.073 percent at the 4 p.m. close in Bangkok, according to the Thai Bond Market Association. The price rose 1.11506, or 11.2 baht per 1,000 baht face amount, to 108.6518.